**Problem Statement:**Bellue Incorporated manufactures a single product. Variable costing net operating income was $114,600 last year and its inventory decreased by 3,000 units. Fixed manufacturing overhead cost was $3 per unit for both units in beginning and in ending inventory. What was the absorption costing net operating income last year?**Multiple Choice Options:**- $114,600- $117,600- $9,000- $105,600**Explanation:**- The problem provides information about the variable costing net operating income and requires a calculation to find the absorption costing net operating income.- The change in inventory and fixed manufacturing overhead cost per unit are key details for solving the question.- Understanding the difference between variable costing and absorption costing is crucial for selecting the correct answer.

Absorption costing: It implies to a costing method that considers or takes into account all the…

Answered: Bellue Incorporated manufactures a…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company produced and sold 3,400 units of its only product this year. The sales price is $162 per unit. Fixed costs include overhead of $85,000 per year, and selling and administrative expenses of $68,000 per year. Variable costs per unit follow. Direct materials Direct labor Variable overhead Variable selling and administrative expenses Use variable costing to compute contribution margin. Variable expenses Contribution Margin (Variable Costing) $ 28 per unit $ 30 per unit $5 per unit 34 per unit
Bent Tree incurred the following unit costs during the year: variable manufacturing cost, $27; fixed manufacturing cost, $10; variable marketing and administrative cost, $8; and fixed marketing and administrative cost, $6. During the year, Bent Tree produced 30,000 units and sold 25,000 units of product. The selling price was $67 per unit. What was Bent Tree's total gross margin? Multiple Choice None of these. $1,000,000 $400,000 $750,000 $800,000
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Assume the following information for a company that produced 10,000 units and sold 9,000 units during its first year of operations: Selling price Direct materials Direct labor Variable manufacturing overhead Sales commission Fixed manufacturing overhead Per Unit $ 200 $ 72 $ 50 $ 10 $8 Multiple Choice $ 287,000 Which of the following choices explains the relationship between the absorption costing net operating income and the variable costing net operating income? The absorption costing net operating income will be lower than the variable costing net operating income by $28,700. The absorption costing net operating income will be lower than the variable costing net operating income by $100,700. Per Year The absorption costing net operating income will be higher than the variable costing net operating income by $28,700.
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Peta, SA manufactures a single product that had the following cost structure this year: Variable Manufacturing Cost per unit: $15 Variable Selling and Administrative cost per unit: $8 Fixed Manufacturing Cost, Total: $261,000 Fixed Selling and Administrative Costs, Total: $132,000 They sold 13,000 units for $60 each during the year, and produced 21,000 units. What is the ending finished goods inventory under variable costing? Select one: A. $99,429 less than under absorption costing. B. $50,286 less than under absorption costing. C. $114,286 less than under absorption costing. D. $120,000 less than under absorption costing. E. $64,000 less than under absorption costing.
Required information [The following information applies to the questions displayed below.] Diego Company manufactures one product that is sold for $71 per unit in two geographic regions-East and West. The following information pertains to the company's first year of operations in which it produced 54,000 units and sold 49,000 units. Variable costs per unit: Manufacturing: Direct materials Direct labor Variable manufacturing overhead Variable selling and administrative Fixed costs per year: Fixed manufacturing overhead Fixed selling and administrative expense $ 22 $ 12 $3 $5 The company sold 36,000 units in the East region and 13,000 units in the West region. It determined that $280,000 of its fixed selling and administrative expense is traceable to the West region, $230,000 is traceable to the East region, and the remaining $76,000 is a common fixed expense. The company will continue to incur the total amount of its fixed manufacturing overhead costs as long as it continues to produce…
Variable and Absorption CostingChandler Company sells its product for $108 per unit. Variable manufacturing costs per unit are $49, and fixed manufacturing costs at the normal operating level of 12,000 units are $240,000. Variable selling expenses are $17 per unit sold. Fixed administrative expenses total $104,000. Chandler had no beginning inventory for the year. During the year, the company produced 12,000 units and sold 9,000. Would net income for Chandler Company be higher if calculated using variable costing or using absorption costing?Calculate reported income using each method.Do not use negative signs with any answers.
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Assume a company has variable manufacturing costs of $20 per unit and total fixed manufacturing overhead per period is $150,000. In its first year of the operations, the company produced 12.500 units and sold 10,300 units and reported absorption costing net operating income of $38,000. What is the company's variable costing net operating income in its first year of operations? Multiple Choice $27,600 $47,600 $21,600 $11,600

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